The dollar/yen fell on the U.S. CPI data, but recovered to the 162 yen range on Federal Reserve Chair Powell's remarks.

【7/14Market Overview

In Tokyo time, USD/JPY rose in the morning to162.46yen, but Finance Minister Katayama said that for the GPIF (Government Pension Investment Fund) framework, there is a rule to reassess if the environment at the time of formulation changes significantly, and Health Minister Ueno also indicated that if necessary, a review of GPIF’s portfolio would be considered going forward, sending the pair down toGPIF’s portfolio，to around 162.23 yen. In European trading, USD/JPY held in a tight range ahead of US CPI andfp.NY time,6 months USCPI for year-on-year and month-on-month figures showed▲0.4％/YoY3.5％ versus expected 3.6% YoY; month-on-month▲0.1％/YoY3.8％; core excluding energy and food0.2％/YoY2.6％ vs. +0.2%/YoY0.2％/YoY2.8％, implying softer data; USD/JPY fell to161.57yen. Afterwards, US Fed Chair Powell, in a congressional testimony, said he would not tolerate high inflation and showed strong determination to achieve the inflation target. In the subsequent Q&A, he spoke of his resolve to prevent a widening of inflation and to further solidify the 2% inflation target. The market viewed these as hawkish, and USD/JPY rebounded to162.28yen.

【7/15Market View